In spite of tough global steel scenario the domestic industry continued to enjoy a bigsupport from the government. Today India has become the third largest steel producerglobally contributing about two per cent of the country's GDP with production of 91.9 MTand a capacity of 122 MT in FY16. The overall steel production in the country crossed the100 million tonnes mark in FY17.
The introduction of the Minimum import price (MIP) on steel by the government duringthe FY16-17 supported the industry's margins. The industry's losses reduced duringApril-December 2016 compared to the corresponding period last year. Sales of the 111 steelcompanies improved during Apr-Dec 2016 where the industry's revenues grew by 9.3% on ay-o-y basis during the period backed by an increase in prices and production. However thenet margins still remained negative despite higher sales.
The government has also announced a policy for providing preference to domesticallymanufactured iron and steel products in government procurement. The policy mandatespreference to domestically Manufactured Iron & Steel Products (DMI&SP) inGovernment Procurement. The DMI&SP policy provides a minimum value addition of 15% innotified steel products which are covered under preferential procurement (Ministry toreview specified steel products and the minimum value addition criterion).
The policy is being considered as a positive measure taken by the government toincrease the off take of domestic production while not putting restrictions on theimports. The government plans to domestically meet entire demand of high grade automotivesteel electrical steel special steels and alloys for strategic applications. The policyis envisaged to promote growth and development of domestic steel Industry and reduce theinclination to use low quality low cost imported steel in Government funded projects.These two measures should give a fillip to the steel industry in the coming years andshould be viewed positively.
The industry continued to get strong support from the government. The Union Cabinet hasgiven its approval for National Steel Policy (NSP) 2017. The policy represents the longterm vision of the government to give required momentum to the steel sector. It seeks toenhance domestic steel consumption and ensure high quality steel production and create atechnologically advanced and globally competitive steel industry.
The new steel policy 2017 has the following aspirations to achieve300 MT ofsteel-making capacity by 2030. The policy calls for an additional investment of Rs. 10 laccrores by 2030-31. The policy plans increase steel consumption on the back of growth ininfrastructure automobiles and housing. It aim is to increase per capita steelconsumption to the level of 160 Kg. by 2030 from existing level of around 60 Kg.
Further the policy aims at adoption of energy efficient technologies in the MSME steelsector and facilitate R&D in the sector through the establishment of Steel Researchand Technology Mission of India (SRTMI).
Meanwhile your company has posted Profit Before Tax at Rs. 390.41 Lacs against loss ofRs. 1197.96 Lacs in the previous year and Company's Profit After Tax stood at Rs. 332.42Lacs against loss of Rs. 1525.36 Lacs in the previous year thereby representing a goodprofit during the year under review.
With the current market scenario set to improve the company has already improved ourproduction quantity wise so that we can capture the opportunity which can directly affectour profit ratio. We are glad to inform that in the first five months of the currentfinancial year (FY-2017-18) the company has already booked new orders of Rs 12500 lacs .
Further we are looking at various options to utilise the freehold land of about 112acres in Raipur like either into renewable energy segment or low cost housing with jointdevelopment option. Various options are being contempted but thing has been finalised asof now.
I extend my sincere thanks to the Board of Directors Management and each & everyperson of Mahamaya Group.
To Shareholders on behalf of Board I thank you for your continued support and lookforward to a positive 2017-18 and beyond.
With best regards: